Memory distributors have slammed the EU and the Department of Trade and Industry for buckling to the whims of Far Eastern memory makers. That means tariffs will be dropped on the 1 August, threatening UK and European firms.
Sukh Rayat, MD of Flashpoint, owned by the Macro Group, said: "The anti dumping regulations are a mockery. For a month or so, people were worried that if they brought in Korean or Japanese products, they?d be faced with big tariffs. The whole market is now awash with grey market memory and prices are coming right down."
That was confirmed by Alan Stanley, MD of the UK division of French memory company Dane-Elec. He said: "It?s a load of bollocks. The market is in freefall. We love it. The duty will go down to zero in the year 2000."
Richard Gordon, senior analyst in charge of memory at Dataquest UK, confirmed there were problems with memory. "The EU has decided that anti-dumping systems are a mockery. We think the EU are going to abolish them and they seem to have come to an agreement with Japanese and Korean vendors. It?s a gentleman?s agreement."
But the geopolitical agreements did affect memory prices, Gordon admitted. He said: "Tariffs are typically without any teeth. We?re in a lull at the moment. The whole thing depends upon whether you believe in a free market or an interventionist situation."
He confirmed that by the end of this century, there will be zero tariffs and zero duties as a result of agreements between Europe, the Far East and America.
But he also confirmed that grey market imports meant that by the end of this quarter a lot of memory stock will be dumped. Gordon said: "The Compaqs of this world want to pay for DRAM at the lowest price, never mind the tariffs."
That, however, is not good enough for the trade, caught between several rocks and several hard places. Rayat said: "This is destroying the channel. We?ve diversified our business a lot. I was happy with this situation when we started."
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